U-turn relief for pension savers
Raj Mody, Head of Pensions at consultants PwC, wins the prize for the most vivid reaction comment on the sudden U-turn on pension tax relief.
“I heard it first on the Radio 4 news late on Friday and I nearly fell out of my bed,” he told People Management’s blog.
It’s a surprise he didn’t hit the floor because as far as everyone was concerned the scrapping of higher rate tax relief on pension contributions was a done deal with the only debate around what else was going to change.
Now it appears pensions are going to be left alone in the Budget on March 16th with the focus moving to fuel duty or increasing higher rate tax thresholds.
The whole saga – which has rumbled on since last summer at least – vividly illustrates how the Budget process works. The debate on tax relief has been held virtually in public and ended with the conclusion that it’s not quite the time.
The communication tactics have been interesting. As Raj Mody notes, the news that nothing was happening emerged on Friday night and it wasn’t actually said by anyone. There’s no press release or official announcement.
Instead it was attributed to Treasury sources who might even have been the same sources who were assuring other journalists earlier in the week that all tax relief on pension contributions was being scrapped and it was time for the Pension ISA.
There was no media spokesperson to ask about the detail of the non-event leaving journalists to speculate about what comes next and to harvest comments from the industry.
It is fair to say there have been mixed reviews. For some, the whole process has been a farce driven by the EU referendum and Conservative Party internal politics while others have welcomed it but urged the Chancellor to leave pensions alone for the foreseeable future. And everyone who was convinced tax relief was doomed, is still convinced it’s doomed.
The lesson for public relations and clients is the old Boy Scout motto of “Be Prepared” to the extent that you can be prepared.
Any organisation with an established and respected media commentator can expect to have been asked for their reaction and if they have an informed view can expect to achieve coverage. They also need to be available and ready to react quickly.
The other lesson is to express that view as vividly as possible – Raj Mody went on to provide genuine insight into what might happen next after the bit about nearly falling out of bed.
But the major lesson is that sometimes you just have to be prepared to be surprised.
Communications, Corporate PR, Economy, Political PR, Public Policy, Raj Moody, The Budget